Lufthansa Formalizes Intentions to Take Over ITA Airways
The German carrier has submitted its intention to acquire the majority of shares of ITA Airways
January 18, 2023
The Lufthansa Group has formally expressed to the Italian Ministry of the Economy its interest in acquiring ITA Airways, the airline that replaced the ill-fated Alitalia in October 2021.
According to the company, the German carrier is preparing to launch negotiations with the Italian government to reach a preliminary agreement over the purchase of shares, which could evolve into a more significant investment.
The Italian Treasury—which owns the entirety of shares over ITA Airways—received a proposal from the German carrier noting that the initial intention would be to purchase at least 40 percent of the Italian airline’s shares, potentially increasing up to 100 percent in the future.
“Deutsche Lufthansa AG is aiming to acquire a stake in the Italian national carrier ITA Airways (Italia Trasporto Aereo S.p.A.),” said the company in a statement. “The plan is to agree on the initial acquisition of a minority stake as well as on options to purchase the remaining shares at a later date.”
However, as noted by Lufthansa, the agreement is contingent on both parties signing the MoU. “Further negotiations and discussions would be conducted on an exclusive basis,” said Lufthansa.
As a result, today’s move by the German carrier is a preliminary step towards a potential privatization of ITA Airways. As noted by Lufthansa, the next steps would be to sign the MoU, followed by a preliminary purchase agreement and the thumbs-up from the European Union’s Antitrust commission.
Lufthansa added that talks with ITA Airways would “primarily focus on the commercial and operational integration of ITA into the Lufthansa Airline Group,” which includes Swiss International Airlines, Austrian Airlines, Brussels Airlines, Eurowings, Edelweiss, and Air Dolomiti.
The German carrier noted that Italy remains the most important market outside its home networks in Switzerland, Germany, and Belgium, as well as the U.S. “Italy’s importance for both business and private travel lies in its strong export-oriented economy and status as one of Europe’s top vacation spots,” said Lufthansa.
The Italian Treasury confirmed receipt of Lufthansa’s letter, noting that it “reserves the right to examine the adequacy of the offer in compliance with the requirements” and that “no other offers had arrived” before the deadline.
Interestingly, Lufthansa remained alone in its bid to present a viable offer for the Italian carrier. Last year, the Air France-KLM group—backed by Delta Air Lines and the Certares consortium—showed interest in partnering with ITA Airways, but a proper financial offer never materialized.
Should Lufthansa’s offer move forward, it would undoubtedly force the Italian carrier to leave SkyTeam and move to Star Alliance. Back in July, during the Farnborough Air Show, ITA Airways CEO Fabio Lazzerini said SkyTeam had been tremendously supportive in granting the airline several deadline extensions to decide on its future alliance partnership goals. With Lufthansa’s official bid on the table, it is likely the Italian flag carrier will leave SkyTeam—the alliance that claimed Alitalia as one of its main partners for more than two decades.